Michigan county seized retiree’s home over $8 debt – now he’s fighting back in state’s top court

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In August 2011, Uri Rafaeli bought a three-bedroom, 1,500-square-foot home in the Detroit suburb of Southfield, Mich., for $60,000. He converted the fixer-upper into a rental property.

Two-and-a-half years later – and at the time unbeknownst to the retired engineer – Oakland County seized his property, put it up for auction and sold the house for $24,500. All this, after a mistake in calculating his property taxes left Rafaeli’s account delinquent by just $8.41. Oakland County ended up keeping all of the $24,500 from the sale, while Rafaeli, now 83, was left without the home and the income he made from renting it.

Rafaeli’s stunning case, which is at the heart of a legal battle currently being considered before Michigan’s Supreme Court, is an extreme example. Yet it is hardly unique: more than 100,000 homeowners in the state have fallen victim to an aggressive property tax law that legislators in Lansing passed two decades ago. Similar statutes have been passed in more than a dozen other states.

Act 123 of 1999 was meant to speed up the redevelopment of blighted properties amid Michigan’s economic woes, but critics of the statute say it has allowed county officials to act as debt collectors and line their coffers by retaining the excess revenue made by selling houses with unpaid property taxes — no matter how paltry the debt.

“When the government takes property to settle a debt, they have to give the extra money they make back to you,” Christina Martin, a lawyer with the Pacific Legal Foundation who is representing Rafaeli in his case against Oakland County, told Fox News. “It doesn’t matter what law Michigan passes, they have the constitutional obligation to pay back any more than they are owed.” – READ MORE

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